broadband speed

“Data provided by the Philippine Chamber of Telecommunications Operators (PCTO) has it that about 5 percent to 7 percent hog the 80 percent of the available bandwidth, leaving only 20 percent of the capacity to be shared by 93 percent to 95 percent of the users.

Smart Communications Inc., for instance, has started campaigning on how to choose the best Internet package available nowadays. Besides this, executives said last week it will introduce a whole new set of packages to suit varying needs of users.

“We will change the way how people use the Internet now, and the key to that is to customize the right package or plan that’s best for them, because people have different needs,” said Smart head for broadband services Gio Bacareza.

In its campaign, Smart said that higher Internet speeds won’t always mean a better Web experience. The upper limit supported by any service provider, Smart said, could be anywhere upward of 56 kbps, with a range reaching up to more than 15 Mbps in some cases, depending on the type of connection used. In practice, however, the claimed speed or bandwidth is not always reliably available to the customer.

“Wired ISPs have large fixed costs of building and maintaining their last mile network of residential cable and fiber. The ISPs’ costs, however, to deliver a marginal gigabyte, which is about an hour of viewing, from one of our regional interchange points over their last mile wired network to the consumer is less than a penny, and falling, so there is no reason that pay-per-gigabyte is economically necessary. Moreover, at $1 per gigabyte over wired networks, it would be grossly overpriced.”

The big question now is how these kind of billing changes will impact ‘Net consumption patterns. Many subscribers use minimal data, but that’s changing as Internet video becomes the norm. If these new plans simply discourage data hogs from backing up their 120GB pirated movie collection over the ‘Net every night, there’s no sleep to be lost. But if they scare consumers away from legitimate non-ISP affiliated movie and content sharing sites, that should be a firebell concern to consumers, entrepreneurs, and regulators.

And not only in Canada.

Exactly. When will these people learn, the Problem with Content is Content Licensing, not the the Network.

Subject: Position Paper on Draft Memorandum Order on Minimum Broadband Speeds

Dear Sir:

Greetings!

We who are internet connectivity consumers would like to present for the Commission’s consideration our position paper on the memorandum order on minimum broadband speeds currently being drafted by your agency. We believe that our paper, exhaustive as it is, presents essential fundamentals that shall provide fairness between subscribers and service providers of internet connectivity.

Should your office require clarifications, we stand ready to be of service.

Jaime Oscar M. Salazar
IT Professional and Internet Connectivity Consumer

Position Paper on the National Telecommunications Commission (NTC) Draft Memorandum Order on Minimum Broadband Speeds

Relevant Law and Policy

The law governing the regulation of internet service providers is the R.A. 7925, “An Act to Promote and Govern the Development of Philippine Telecommunications and the Delivery of Public Communications Services”, otherwise known as the “Public Telecommunications Policy Act of the Philippines”, which took effect in 1995.

R.A. 7925 provides the national policies that should guide the National Telecommunications Commission (NTC), the government agency empowered to enforce this act, and the policies germane to the debate include:

“a) A fundamental objective of government is to develop and maintain a viable, efficient, reliable and universal telecommunication infrastructure using the best available and affordable technologies, as a vital tool to nation building and development;

e) Public telecommunications services shall be provided by private enterprises. The private sector shall be the engine of rapid and efficient growth in the telecommunications industry.

f) A healthy competitive environment shall be fostered, one in which telecommunications carriers are free to make business decisions and to interact with one another in providing telecommunications services, with the end in view of encouraging their financial viability while maintaining affordable rates;

i) For efficiency, practicability, and convenience, but with due regard to the observance of due process at all times, regulation of telecommunications entities shall rely principally on an administrative process that is stable, transparent and fair, giving due emphasis to technical, legal, economic and financial considerations.”

R.A. 7925 also provides the duties of the NTC that are germane to the policy debate:

“b) Ensure quality, safety, reliability, security, compatibility and inter-operability of telecommunications facilities and services in conformity with standards and specifications set by international radio and telecommunications organizations to which the Philippines is a signatory;

d) Foster fair and efficient market conduct through, but not limited to the protection of telecommunications entities from unfair trade practices of other carriers;

e) Promote consumers’ welfare by facilitating access to telecommunications services whose infrastructure and network must be geared towards the needs of individual and business users;

f) Protect consumers against misuse of a telecommunications entity’s monopoly or quasi-monopolistic powers by, but not limited to, the investigation of complaints and exacting compliance with service standards from such entity.”

R.A. 7925 also provides for the basic rights of telecommunications services end-users that are germane to the policy debate, most notably:

“a) Entitlement of utility service which is non-discriminatory, reliable and conforming with minimum standards set by the Commission.”

R.A. 7925 also provides basic terms definitions that are germane to the policy debate:

“a) Telecommunications – any process which enables a telecommunications entity to relay and receive voice, data, electronic messages, written or printed matter, fixed or moving pictures, words, music or visible or audible signals or any control signals of any design and for any purpose by wire, radio or other electromagnetic, spectral, optical, or technological means.

b) Public telecommunications entity – any person, firm, partnership or corporation, government or private, engaged in the provision of telecommunications services to the public for compensation.

h) Value-added service provider (VAS) – an entity which, relying on the transmission, switching and local distribution facilities of the local exchange and inter-exchange operators, and overseas carriers, offers enhanced services beyond those ordinarily provided for by such carriers.”

This position paper is framed within the relevant national law and policy, and puts these over and above any other considerations except fairness and equity among all the stakeholders.

Internet Connectivity Promotes Transparency in Government

The experience of the United Kingdom in making government data public is a practical example.

The British government made non-confidential data available to the public, and the public went ahead and developed ways and means of using the data – from free software applications that gave stakeholders information on road conditions and infrastructure spending to group efforts related to citizen watchdog activities ensuring the integrity of public servants.

Closer to home is the pedestrian example of the livestreaming of public hearings, an activity with far-reaching benefits. Without internet connectivity, the NTC hearing could not have reached the public, and the Commission would have failed to live up to its mandate of protecting the Filipino telecom consumer. It is noteworthy that the NTC hearing that was livestreamed has resulted in citizens being informed of the Commission’s efforts, and citizens are now showing their appreciation via position papers such as this one.

Of course, the online viewers found it disappointingly ironic that the unreliability of the internet connectivity resulting in audio gaps and skips demonstrated the need for fair reliability that service providers seem unwilling to acknowledge.

As internet connectivity is a great enabler, it is in the best interests of the public through the efforts of the NTC to have internet connectivity to be provided with low barriers to entry and consumer-oriented reliability.

Internet Connectivity Promotes Civil Rights and Enables Communities

US Secretary of State Hillary Clinton, in a policy speech on 21 January 2010, said that “The spread of information networks is forming a new nervous system for our planet.”

She then described “Internet Freedom,” which is the Freedom to Connect. She said, “The Freedom to Connect is the idea that governments should not prevent people from connecting to the Internet, to websites, or to each other. The freedom to connect is like the freedom of assembly, only in cyberspace. It allows individuals to get online, come together, and hopefully cooperate. Once you’re on the Internet, you don’t need to be a tycoon, or a rock star to have a huge impact on society.”

Furthermore, internet connectivity promotes and facilitates constitutionally-guaranteed rights, such as the right to free expression, the right of association and peaceful assembly, the right to information on government activities and matters of public interest. Through internet connectivity, mass media allows for greater depth and breadth of reportage, as well as convenience and ease of access of media coverage.

Over and above these, internet connectivity not only promotes the civil rights, it also is an enabler in the saving of lives. Without internet connectivity, the “bayanihan spirit” of the online Filipino could not have been leveraged during the typhoons Ondoy and Pepeng. Then, internet-connected Filipinos aided in the mobilization of volunteers, the identification of priority areas, the collection and allocation of donations – all towards helping less-fortunate Filipinos. Without internet connectivity, these laudable efforts could not have happened in ways that are equally as fast and as actively pursued.

Clearly, internet connectivity supports and promotes the enjoyment and protection of civil rights, as well as enabling communities to serve best as fellow citizens of the Philippines.

It is therefore required of the Commission to ensure the continued protection of civil rights as enabled by internet connectivity, by way of promoting fairness between service providers and the Filipino consumer.

Internet Connectivity is Beneficial to the Economy

The Organization for Economic Co-Operation and Development in 2008 published “Broadband and the Economy.” It is a paper that examines how broadband networks interact with the economy.

It concluded several things. First, broadband networks are integral part of the economy, and collectively is a “general purpose technology enabler”:

“GPTs are technologies that enable changes, which is also the case for ICTs, with broadband acting as the required infrastructure enabler (like the electricity transmission and distribution network in the case of electricity), and the Internet as the platform supporting an endless variety of applications. Thus, their effects are likely to build up over time. They can be expected to raise productivity, and give rise to network economies with network effects expanding over time. There will be new process, product and organisational innovations beyond what can even be imagined today.”

Second, broadband has become an integral part of almost every aspect of a knowledge based economy.

Broadband is the 21st equivalent of what roads, railways, telegraphs and postal services were to the 19th and 20th century.

Third, OECD noted that, “ICTs and broadband create new ways for companies to exploit the creativity and innovativeness of their workforce. Blogs, wikis, podcasting, tagging technologies, and lessons of community and social networking sites are increasingly seen as important tools to improve the efficiency of employees (Bughin, 2007; The McKinsey Quarterly, 2007; Wunsch-Vincent and Vickery, 2007).“

Fourth, in the Philippines, online workers such as The Lady Programmer who rely on the Internet for income will be grossly affected by a broadband cap, and is grossly affected by the slow internet in the Philippines.

The World Bank determined that for low- and middle income countries, that for every 10 percentage point increase in broadband penetration, it accelerates economic growth by 1.38 percentage points.

Broadband Speeds Promote Faster National Growth

The Global Network Readiness Index for 2009-2010 ranked the Philippines as 85 out of 133 countries. This report measures the propensity for countries to exploit the opportunities offered by information and communications technology.

Broadband is Not a VAS, and Can and Should be Regulated as a Utility

The first point of contention is whether or not the internet broadband service provided by the telecom companies such as BayanTel, Digitel, Globe Telecom, Liberty Telecom, PLDT, Smart Communications, and Sun Cellular, is a value-added service (VAS).

We submit that data services such as internet connectivity are no longer VAS.

Telecommunications entities locally and worldwide have switched their telecommunications technology from analog to digital. Data communication over the public switched telephone network (PSTN) is no longer an enhanced service over and above voice services, which was previously analog. With the current technology used by the telecommunication networks, voice and data are normal services carried over digital networks.

Since data services are now ordinarily provided by carriers via their digital wireline and wireless networks, data services are not VAS. As such, internet broadband cannot be a VAS.

Clearly, because internet connectivity, broadband or not, is not a VAS, internet connectivity should not be a deregulated service or utility. As broadband is not a VAS, minimum service standards can and should be imposed for the protection of the Filipino consumer.

Broadband is Not Completely Subject to Free Market Dynamics

A contention of those supporting broadband as a VAS and therefore should be deregulated is that the dynamics of competition and a free market is what will result to service quality appropriate to the Filipino consumer.

This is patently false. Enshrined in our Constitution is the prohibition of the entry of foreign-owned companies, thereby promoting a protectionist environment for local telecommunications firms. There is little means for outside companies to come in and pose the kind of competition to local service providers that will result in better service quality.

Furthermore, telecommunications companies require legislative franchises, making the entry and establishment of new local firms more careful and longer in time. As such, the market can be and is already limited to a small number of players — an environment that is not conducive to competition that will result in better service quality.

As such, since the Republic provides haven and protection for local service providers, it is incumbent upon the NTC on behalf of the Filipino consumer to demand minimum service standards, of which the service providers can use as a baseline for their competition to begin.

In a study conducted by the World Bank called, “Rising Growth, Declining Investment: The Puzzle of the Philippines,” published in 2008, Alessandro Bocchi asked, “Over the last 10 years, however, domestic investment, while stagnant in real terms, has shrunk as a share of GDP. In an open and growing economy, why the decline?”

Bocchi answered that one of the reasons is that capital-intensive private sector does not want to invest.

The expectations on future profitability of investment are low.

Broadband Strategies That Work

Building Broadband: Strategies and Policies for the Developing World by Yongsoo Kim, Tim Kelly, and Siddhartha Raja, suggests that policy makers approach Broadband holistically. It recommends to follow the Korean experience as that market has experienced rapid growth in Broadband market, outperforming higher income countries, but at the same time, the Korean feature is relevant to low to middle income countries.

What were the key plays down by the Korean government? According to Kim, Kelly and Raja, the effort included public investment in broadband infrastructure and incentives for private investment.

More importantly, Korea viewed it as more than a network, or improved communications service.

They developed a vision of the information society, and set development frameworks to creating a supply and demand-side policies such as lowering market entry barriers and spurring demand.

Different Definitions of Broadband are Not Hindrances to NTC Definition

We concede that there does not yet exist a commonly-accepted definition of minimum broadband speed, despite the existence of technical definitions of technologies such as ADSL and HSPA, as well as full knowledge of their technical capabilities. Thus, it is unnecessary for the NTC to define the technologies, given that their definitions already exist; however, it is necessary to provide for the Filipino consumer what is the market definition of broadband in the Philippine, irrespective of the technology used.

These definitions as proposed allow flexibility on the part of the Commission and on the part of the service providers in terms of the technologies that the service providers will deploy (e.g., fiber, cable internet, HSPA, WCDMA, WiMAx). In line with such flexibility, such definitions provide clarity to the Filipino consumer and therefore a better and fairer environment for the service providers to compete in.

Promoting such an environment on behalf of the Filipino consumer is part of the mandate of the NTC.

Service Providers Have no Authority to Set Caps Under the Premise of Anti-Piracy

What a subscriber pays for to telecommunications companies is access to content; hence, “subscriber line.” Data volume caps are iniquitous and inequitable because it empowers telecommunications limit content to which they do not own, and furthermore have no right to limit.

Data volume capping and speed throttling will not prevent unscrupulous subscribers from accessing pirated content; instead, it will merely make the access longer. What is certain is that content piracy is the subject of content licensing, and content piracy is a business issue of content providers, not of telecommunications companies.

In the past decade there has been a clear winning formula in the fight against piracy. It is this: make content people want available. Make it easy for them to pay for that content and lastly make it easy for them to get that content. The ease of digital downloads from stores like iTunes, Amazon, and Steam shows that such companies are clear winners in understanding the formula, and people are buying from these stores instead of shopping for pirated ware.

Recently, Wired Magazine published an article declaring that the Age of Music Piracy is over.

The death is attributed to the availability of paid music downloads. The barrier for entry is so low, that anyone can now buy music easily through credit card or prepaid cards on Amazon or iTunes.

However, the same content licensing that is abundant in the United States is limited in the Philippines, and should broadband caps be approved purportedly because of content licensing, additional barriers to entry will be erected by the government and service providers. Such will instead encourage digital piracy.

Today, games could be readily bought online, and downloaded, and the data volume required is in the multi-gigabyte range. Massively Multiplayer Online Role-Playing Games (MMORPGs) is a billion dollar industry and is one of the things people play in internet cafés in the Philippines, which is the primary method of access of the Filipino consumer. Should barriers to access be erected by capping broadband data volumes and speed throttling, pirated computer games shall see a re-emergence, as online games no longer are accessible to consumers, effectively encouraging piracy instead of combating it.

Clearly, data volume capping and speed throttling based on content issues is a short-sighted alibi of telecommunications companies. Connection must be irrespective of content, in the same way a toll way does not demand that only trucks with bottles can pass, disallowing trucks carrying cans.

A final point: piracy is within the purview of the Optical Media Board and the Business Software Alliance. Once it is made clear that the long term result of broadband capping is greater incidence of piracy, their opinion should hold weight – not those of telecommunications service providers.

“Network Abuse” is a Vague Term Promoting Service Provider Self-Interest and is Against True “Fair Use”

Terms such as “network abuse” and “abusive users”, used by service providers to justify the lack of minimum service standards while calling for the establishment of a “fair use policy” are at best vague and at worst misleading.

Service providers, service provider organizations, and knowledgeable sources themselves admit the following:

1. Users who maximize their data rate and data volume use constitute no more than 5% of the entire subscriber population.

2. Service providers practice “overbooking”; i.e., service providers “sell” more than is their available capacity to deliver, on the premise that not all subscribers use their internet connectivity at the same time.

3. Service providers automatically assume that maximizing one’s use of one’s subscription is indicative of using it for commercial or illegal (“unfair use”) purposes.

These positions above of the service providers ensure that no Filipino consumer can use in full the internet service he is being billed for in full.

The concept of “fair use” is itself laudable when being done towards the protection of the consumer, and the concept we support. The concept, however cannot exist in practice if the service providers make the assumption that a consumer’s maximization of his subscription is unfair.

On the concept of using data volume caps as a means of measuring fair use: accessing the internet through any means makes certain that data is downloaded and uploaded while the subscriber is connected. Unless and until “goodput” — only useful information for the subscriber — becomes the measure of data volume instead of “throughput” — data volume that is inclusive of signaling packets and other non-information packets over and above the useful information to the subscriber, then data volume must not be used as a measure of “fair” or “unfair” use.

Furthermore, the laws of physics, which cannot be repealed nor regulated by service providers or legislation, themselves dictate the volume of data that can be transmitted by a specific connection speed per amount of time spent connected. As such, using data volume to measure “fair use” provides an additional constraint over and above constraints of time of use, furthering the unfairness suffered by the Filipino consumer.

Such a definition of fair is tantamount to a wet market association asserting to the Department of Trade and Industry that consumers must pay full price for a sack of rice that is half its size underweight.

Therefore, we reject the idea of data volume capping as a means of determining “fair use”. Should the data volume be used as a means of determining “fair use”, we recommend that the data volume cap per day must not be lower than 80% of the data volume as calculated using Shannon’s Law, with the assumption that the data transmission is lossless and zero carrier or transmission medium noise. The 20% margin allows for carrier loss, noise, multipath fading, and other factors that degrade data transmission.

As such, we propose the following concepts to compromise with the service providers towards defining “fair use”:

1. The service provider may declare how many hours per 24-hour period constitute “fair use”; however, the service provider:

a. Shall not declare the “fair use” period to be less than 80% of a 24-hour period, or 19.2 hours;

b. Shall not restrict the “fair use” number of hours to a specific time period or time periods within the 24-hour period;

c. Shall not “carry over” usage hours from the previous 24-hour period to the present 24-hour period in the computation of “fair use” hours;

d. Shall not use data volume as a measure of “fair use” if the service provider uses usage time as a measure; and,

e. Shall begin the 24-hour period at midnight, local time, and the count of hours is reset as soon as midnight is reached.

2. The service provider may declare how much data volume per 24-hour period constitutes “fair use”; however, the service provider:

a. Shall not declare the “fair use” data volume to be less than 80% of the data volume that can be provided by the advertised “up to” speed in a 24-hour period, assuming lossless transmission and zero carrier or transmission medium noise;

b. Shall not “carry over” data volume from the previous 24-hour period to the present 24-hour period in the computation of “fair use” data volume;

c. Shall not use usage time as a measure of “fair use” if the service provider uses data volume as a measure; and,

d. Shall begin the 24-hour period at midnight, local time, and the data volume measurement is reset as soon as midnight is reached.

3. Should a service provider choose not to provide a “fair use” policy, the default “fair use” standard shall be based on hours of use.

Promoting a true “fair use” environment on behalf of the Filipino consumer and the service provider is part of the mandate of the NTC.

The Reliability of Internet Connection Must be Fair

For a “fair use” environment to thrive and be embraced by the public, service providers must provide a fair level of reliability for their subscribers. “Fair use” cannot coexist when demands are only made by one side for the other to answer.

The measurement of reliability within a time period is insufficient if time is the sole basis for determining reliability of an internet connection. Such a basis can be abused by an unscrupulous service provider, who can say that his downtime — the amount of time there is no connectivity provided to the subscriber — is zero percent, when the reality is that the unscrupulous service provider is consistently providing a connection speed that is already cheating the subscriber.

As such, we propose the following concepts to ensure more precise measurement of reliability:

Service reliability = {[(Number of seconds of actual subscriber use during the period) – (Number of seconds below service data rate during actual subscriber use during the period)] / (Number of seconds of actual subscriber use during the period)} x 100%

4. Service reliability shall not be below 80%.

5. Overall reliability shall be calculated as:

Overall reliability = Data rate reliability x Service reliability

6. Service reliability shall not be below 80%.

7. Periods of data rate, service, and overall reliability measurements must be identical for prepaid and postpaid subscribers, and neither subscriber shall be subject to periods of measurement that make calculation inconvenient; i.e., users subscribing via daily prepaid services shall not be subject to reliability measurements longer than a per-hour basis.

Providing consumer protection for the Filipino internet users via the requirement of minimum service reliability is part of the mandate of the NTC.

Speed Throttling Must Be Fair

One means adopted by service providers in managing their networks is the use of speed throttling — i.e., the automated reduction of the data rate — which is not in itself necessarily unfair to the consumer.

However, the statement above comes with a caveat: speed throttling must not be to a level of service that is unfair, and by unfair we mean that that the connection speed must not go below a speed that is hampers or hobbles the customer experience.

Therefore, we propose the following concepts to compromise with the service providers towards regulating speed throttling:

1. The service provider may use speed throttling as a means of managing network use, provided:

a. Only the subscriber whose use exceeds “fair use” guidelines shall have his internet connection subject to speed throttling;

b. Speed throttling must not result to a connection speed that is lower than 50% of the subscriber’s minimum data rate; and,

c. The data rate is returned to normal at the same time “fair use” measurements are reset; i.e., if the “fair use” period is measured starting midnight of the previous day to midnight of the following day, and speed throttling is applied within the period, then the data rate shall be returned to the subscriber’s minimum data rate upon midnight of the following day.

2. The unwarranted application of speed throttling will be considered a breach of service reliability, and the service provider will be subject to the appropriate penalties, along with rebates and refunds due to the subscriber due to the breach of service reliability.

Promoting an equitable service environment between the Filipino consumer and the service provider is part of the mandate of the NTC.

We as internet connectivity consumers are cognizant of the role of competition and market forces to promote growth in the telecommunications industry. As such, we do not oppose the marketing of “best effort” services as one more set of products in a service provider’s portfolio of services.

However, “best effort” services must be truly reflective of a service provider’s best efforts; while “best effort” services are not expected to be at par with minimum levels of service as guided above, they must be at a level that does not compromise consumer protection.

Such an approach is akin to providing certain brands of rice at prices less than the prices of premium brands, but a kilogram of rice still contains a kilogram of rice — a concept that the Department of Trade and Industry promotes as a means of consumer protection.

Therefore, we propose the following concepts to compromise with the service providers towards “best efforts” services:

a. Any advertisements, flyers, brochures and service agreements and service level agreements including “burst” speeds in their promotion of “best effort” services shall specify the minimum lengths of actual connection time and the start and end times of periods of internet connection use within which “burst” speeds can be enjoyed;

b. “Best effort” services shall not be the sole product of service providers, and shall not be the sole non-commercial internet connectivity product of service providers; and,

c. Customer complaints regarding “best effort” services shall be resolved in favor of the subscriber, unless the service provider is able to provide preponderance of evidence that the fault does not lie with the service provider.

Ensuring fair “best efforts” services protects customers while ensuring the growth of telecommunications services, which the NTC is mandated to do.

Any Penalties Must Be Fair, and Subscribers Must Not be Unduly Inconvenienced

The bulk of communications products being marketed today use prepaid as a model; as such, prepaid subscribers can be unduly inconvenienced if pressed to claim refunds and rebates in the same manner as postpaid subscribers do.

As such, while postpaid subscribers can be afforded premium customer service, prepaid subscribers must not be left in the lurch.

Therefore, we propose the following concepts to compromise with the service providers towards providing rebates and refunds without compromising the customer experience:

7. The NTC, upon recommendation of all stakeholders, will determine the official data rate and volume measurement and monitoring tool to be used to measure network traffic.

8. The information generated by the official data rate measurement and monitoring tool shall be the primary basis to resolve disputes regarding data rates, service reliability, and data volumes between service providers and subscribers.

9. Service providers shall provide automated means for the subscriber to be made aware that the use of his internet connection is nearing “fair use” thresholds, has reached “fair use” thresholds, and has exceeded “fair use” thresholds. Service providers shall not apply speed throttling or data volume capping without such automated means of informing the subscriber.

10. Service providers shall provide automated means for the subscriber to be made aware that the subscriber is nearing the end of the “fair use” period, has reached the end of the “fair use” period, and that a new “fair use” period has begun. Service providers shall not apply speed throttling or data volume capping without such automated means of informing the subscriber.

11. Automated means of refund or rebate shall be provided by the service provider, should minimum standards not be met by the service provider. The service provider shall provide the refund or rebate immediately to the subscriber upon resumption of the levels of service subscribed, without need for demand on the part of the subscriber.

12. Service providers shall provide the official data rate and volume measurement and monitoring tool free to all their subscribers.

13. Service providers shall ensure that the official data rate and volume measurement and monitoring tool shall be compatible with the operating systems of their subscribers.

Ensuring a just, fair, and equitable environment for subscribers and service providers is not only the mandate of the NTC, it is enshrined in the civil rights guarantees of fairness for all.

Proposing a Draft Memorandum Order With Fairness for Subscribers and Service Providers in Mind

We respectfully wish to submit for the Commission’s consideration a draft memorandum order embodying all the concepts above, with the goal of providing fairness between subscribers and service providers. Below is the draft memorandum order:

(Draft begins here.)

MEMORANDUM ORDER

SUBJECT: MINIMUM SPEED OF BROADBAND CONNECTIONS

WHEREAS, the 1987 Constitution fully recognizes the vital role of communications in nation building and provides for the emergence of communications structures suitable to the needs and aspirations of the nation;

WHEREAS, the promotion of competition in the telecommunications market is a key objective of Republic Act No. 7925 (RA7925, for brevity), otherwise known as The Public Telecommunications Policy Act of the Philippines, which mandates that “a healthy competitive environment shall be fostered, one in which telecommunications carriers are free to make business decisions and interact with one another in providing telecommunications services, with the end in view of encouraging their financial viability while maintaining affordable rates”;

WHEREAS, RA7925 further defines the role of the government to “promote a fair, efficient and responsive market to stimulate growth and development of the telecommunications facilities and services”;

WHEREAS, RA7925 mandates the National Telecommunications Commission (the Commission/NTC, for brevity) to promote and protect the consumers of public telecommunications services;

WHEREAS, customers/ subscribers/ users have the right to be informed of the quality of the broadband/ internet connection service being provided;

NOW, THEREFORE, pursuant to RA7925, Executive Order (EO) No. 546 series of 1979, and in order to maintain and foster fair competition in the telecommunications industry, and promote and protect the rights of broadband service customers/ subscribers/ users, the National Telecommunications Commission hereby promulgates the following definitions and rules:

A. 6. The Commission shall adopt the official technical definitions of technologies such as but not limited to GSM, HSPA, WiMax, LTE, and so forth, as provided for by the ITU and other international bodies and consortia.

B. Rules

B. 1. Service providers shall be allowed to specify the maximum (“up to”) theoretical broadband/ internet connection data rates and the service rates in their offers to consumers/ subscribers/ users in their advertisements, flyers, brochures and service agreements and service level agreements.

B. 2. Service providers shall specify the minimum actual broadband/ internet connection data rates (“minimum data rates”) and the service rates in their offers to consumers/ subscribers/ users in their advertisements, flyers, brochures and service agreements and service level agreements.

B. 4. Upon the occurrence of periods where the actual downstream or upstream data rates are below the minimum data rate (“below service level data rate”), said periods (“below service level period”) shall not be subject to billing by the service provider.

B. 5. Service providers shall be allowed to specify the maximum data rate reliability (“best data rate reliability”) and the service rates in their offers to consumers/ subscribers/ users in their advertisements, flyers, brochures and service agreements and service level agreements.

B. 6. Service providers shall specify the minimum data rate reliability (“minimum data rate reliability”) and the service rates in their offers to consumers/ subscribers/ users in their advertisements, flyers, brochures and service agreements and service level agreements.

B. 7. Data rate reliability is measured over a period of one (1) day and calculated as:

B. 9. Service providers shall be allowed to specify the maximum service reliability (“best service reliability”) and the service rates in their offers to consumers/ subscribers/ users in their advertisements, flyers, brochures and service agreements and service level agreements.

B. 10. Service providers shall specify the minimum service reliability (“minimum service reliability”) and the service rates in their offers to consumers/ subscribers/ users in their advertisements, flyers, brochures and service agreements and service level agreements.

B. 11. Service reliability is measured over a period of one (1) day and calculated as:

Service reliability = {[(Number of seconds of actual subscriber use during the day) – (Number of seconds below service data rate during actual subscriber use during the day)] / (Number of seconds of actual subscriber use during the day)} x 100%

B. 12. Service reliability shall not be below 80%.

B. 9. Service providers shall be allowed to specify the maximum overall reliability (“best overall reliability”) and the service rates in their offers to consumers/ subscribers/ users in their advertisements, flyers, brochures and service agreements and service level agreements.

B. 10. Service providers shall specify the minimum overall reliability (“minimum overall reliability”) and the service rates in their offers to consumers/ subscribers/ users in their advertisements, flyers, brochures and service agreements and service level agreements.

B. 11. Overall reliability is measured over a period of one (1) day and calculated as:

B. 13. Service providers may set maximum limits on the data volume allowed per subscriber/user per day, provided:

B. 13. a. The limit shall not be less than 80% of the data volume that can be provided per day by the maximum (“up to”) theoretical broadband/ internet connection data rate; e.g, the data volume limit of a 768 kbps downstream connection shall not be less than 80% of 7.9 GB per day, or 6.3 GB per day;

B. 13. b. No limits shall be set for upstream data volumes.

B. 14. The service offers made through advertisements, flyers, and brochures shall contain the service rates for broadband/ internet connection data rates, data rate reliability, and service reliability using any of these methods, e.g.:

B. 16. e. “Best efforts” services must not be the sole product of the service provider.

B. 16. f. Automated means of refund or rebate shall be provided by the service provider, should any of the rules B. 16. a., B. 16. b., B. 16. c., and B. 16. d. not be met by the service provider. The service provider shall provide the refund or rebate immediately to the subscriber upon resumption of “best effort” service, without need for demand on the part of the subscriber.

B. 16. g. Should the service provider be unable to show proof of compliance with B. 16. e., the Commission shall file the appropriate administrative charges.

B. 23. The NTC, upon recommendation of all stakeholders, will determine the official data rate and volume measurement and monitoring tool to be used to measure network traffic.

B. 24. Service providers shall provide the official data rate and volume measurement and monitoring tool free to all their subscribers.

B. 25. Service providers shall ensure that the official data rate and volume measurement and monitoring tool shall be compatible with the operating systems of their subscribers.

B. 26. The information generated by the official data rate measurement and monitoring tool shall be the primary basis to resolve disputes regarding data rates, service reliability, and data volumes between service providers and subscribers.

B. 27. Service providers shall provide automated means for the subscriber to be made aware that the use of his internet connection is nearing “fair use” thresholds, has reached “fair use” thresholds, and has exceeded “fair use” thresholds. Service providers shall not apply speed throttling or data volume capping without such automated means of informing the subscriber.

B. 28. Service providers shall provide automated means for the subscriber to be made aware that the subscriber is nearing the end of the “fair use” period, has reached the end of the “fair use” period, and that a new “fair use” period has begun. Service providers shall not apply speed throttling or data volume capping without such automated means of informing the subscriber.

B. 29. Automated means of refund or rebate shall be provided by the service provider, should minimum standards not be met by the service provider. The service provider shall provide the refund or rebate immediately to the subscriber upon resumption of the levels of service subscribed, without need for demand on the part of the subscriber.

B. 30. The subscribers/consumers shall be properly informed of the broadband/ internet connection service being offered to them.

B. 31. a. The service provider submits proof that their subscriber base is not greater than 80% of their capacity;

B. 31. b. The service provider submits proof that even if their subscriber base is not greater than 80% of their capacity, their ability to meet minimum reliability thresholds is limited;

B. 31. c. The reduction in reliability thresholds shall not result in reliability thresholds less than 25% below “best efforts” reliability thresholds.

B. 31. d. The service provider shall reduce the service rates equitably, and the reduction in service rates shall not be less than 25% of the current service rates.

B. 31. e. The reduction in reliability thresholds shall be effective for only one (1) year, after which the service provider is required to comply with the minimum reliability thresholds prior to the reduction allowed by the NTC;

B. 31. f. Should the service provider be unable to show proof of compliance with B. 31. a., B. 31. b., B. 31. c., and B. 31. d., the Commission shall reject the application without prejudice to the filing of applicable administrative charges.

B. 31. g. Should the service provider be unable to show proof of compliance with B. 31. e., the Commission shall file the appropriate administrative charges, without prejudice to requiring the service provider to pay penalties and fines deemed equitable by the NTC.

B. 31. h. The Commission shall hold public hearings upon receipt of a request of a service provider for the reduction of minimum reliability thresholds.

B. 31. i. No service provider shall be allowed to make a request for the reduction of minimum reliability thresholds within one (1) year of a disapproved request for the reduction of minimum reliability thresholds or two (2) years of an approved request for the reduction of minimum reliability thresholds, whichever is applicable.

B. 32. The Commission may allow service providers different service rates for prepaid services, provided:

B. 36. This Order shall take effect fifteen (15) days after publication in a newspaper of general circulation and three (3) certified true copies are furnished the UP Law Center.

(Draft ends here.)

Concluding Remarks

We applaud the National Telecommunications Commission’s efforts towards protecting the Filipino broadband consumer. It is because of wholehearted efforts that we are confident that transparency in public service – the “tuwid na daan” – will result in fair and just rules for all stakeholders.

As such, we shall watch the process with great interest, and we commit to be of assistance to the Commission in however best we can.

The ProPinoy Project

The ProPinoy Project is a Global Community Center for all things Pinoy, to connect Filipinos at home and abroad by creating a space for ideas, trends and analyses about the Philippines and the global Pinoy community to inspire informed discussion and transformative action.

The ProPinoy Project is a Global Community Center for all things Pinoy, to connect Filipinos at home and abroad by creating a space for ideas, trends and analyses about the Philippines and the global Pinoy community to inspire informed discussion and transformative action.